Statistics Canada showed an unemployment rate of 6.9%, indicating most cuts in the manufacturing sector.
Canada’s unemployment rate has jumped to its highest level since November, as President Donald Trump’s tariffs have affected an export-dependent economy.
Statistics Canada rose 0.2% in April, raising the country’s unemployment rate to 6.9%, according to a report released Friday.
The 6.9 diagram coincided with the unemployment in November. This was the height of eight years outside of the pandemic era.
The agency lost 31,000 jobs each month, pointing to tariffs imposed by the US on the manufacturing sector of the country. The wholesale, retail and trade sectors have cut 27,000 jobs.
Public sector employment rose 23,000 or 0.5% in April, particularly due to the temporary increase in employment in the federal elections on April 28th, after most changes over three months.
The average hourly wage growth for full-time employees, a metric closely monitored by the Central Bank of Canada to measure inflation trends, was 3.5% in April, and has not changed since March.
Overall, employment numbers remained pretty flat, minimising 7,400 jobs in April, slightly higher than expected by 6.8% analysts. This was in contrast to the loss of 32,600 jobs the previous month.
The employment rate, or the proportion of the working-age population employed, was 60.8% in April, following a 0.2 percentage point decline in March. This was a six-month low, according to the statistics agency. Employment rates have declined for most of 2023 and 2024 as population growth outweighed employment benefits. However, since February, the population growth has not been that high, but employment growth has slowed down.
“Unemployed people continued to face more challenges in April than they had a year ago,” Statscan said, adding that of those who lost their jobs in March, 61% remained unemployed in April, almost four percentage points higher than the same period last year.
Major hits coming
Trump’s tariffs on Canadian steel and aluminum in March, as well as automobiles in April, and import duties on a wide range of products with various reductions and exemptions, affected businesses and households.
The Bank of Canada warns growth will be hit hard in the coming months as exports fall, prices rise, jobs fall and layoffs accelerate. He says that if the economy needs urgent assistance, it will act decisively.
“Overall, we are looking at a weak job market towards the trade war. It looks like we could give in quickly now. Today’s report supports the Bank of Canada’s cuts case in June,” Ali Jaffery, senior economist at CIBC Capital Markets, told Reuters.